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Ministry says it is striving to cut dependency on energy imports

Watcharapong Thongrung
The Nation August 9, 2014 1:00 am

The Energy Ministry will seek ways to boost domestic sources to reduce the country's heavy dependency on imported energy, while a scholar has urged price reforms to reflect actual costs and promote efficient energy use.

The ministry's permanent secretary Areepong Bhoocha-oom said that last year the value of imported energy was Bt1.4 trillion. He vowed to seek ways to reduce energy imports and promote the use of domestic sources as well as alternative energy.

The ministry is drawing up a new Power Development Plan for 2015-2035, he said at a seminar on energy hosted yesterday by the Economic Reporters Association.

The new PDP is expected to be completed within three months. It puts importance on the development of clean coal energy, collaboration with the neighbouring countries such as Myanmar and Laos on energy production, and the promotion of alternative sources such as biomass and biogas. The cost of the government incentives to be offered to these energy producers is lower than for solar and wind energy.

Kurujit Nakornthap, director-general of the Mineral Fuels Department, said he would push for the launch of the 21st round of petroleum-concession tendering to boost reserves. If Thailand fails to seek ways to replenish its petroleum reserves, it might have to import greater quantities of pricey liquefied natural gas, which would result in higher electricity prices.

Praipol Koomsup, an economics lecturer at Thammasat University, said the current distorted energy price structure encouraged the inefficient use of energy. Therefore, the country had to spend a great deal on energy imports.

He added that the country had to adjust fuel excises to reflect the actual costs. The petrol excise should be cut to Bt4 a litre from the current Bt7, while that of diesel is raised to Bt4 a litre from 5 satang. The price of liquefied petroleum gas at the refinery gate should increase from Bt10.8694 per kilogram to Bt23.7288.

Praipol said the low diesel excise cost the country an opportunity to generate income of about Bt100 billion a year, which could be spent on developing many projects such as the dual-track rail system, and also encouraged the over-consumption of diesel.